A New Year Needs a New Approach to the Patient Financial Experience

Nearly six out of 10 healthcare leaders are confident their organizations will enjoy a positive industry outlook in 2025, and 69% predict they will see increased operating revenue, a Deloitte survey shows. But confidence in rising revenue depends in part on a more consumer-centric model for payment.

Leaders acknowledge the need to address both the affordability of care and the patient experience in the year ahead. Most believe consumer perceptions of healthcare affordability will have a “significant impact” on the industry, the Deloitte survey reveals. Among their top focuses: strengthening consumer experiences, engagement and trust (53%).

But pain points in the patient payment experience—typically the last experience in the consumer healthcare journey and one that is likely to shape the consumer’s perception of the organization—run deep. It’s time for healthcare organizations to overcome the familiar barriers that stand in the way of better financial performance.

Uncovering Breakdowns in Financial Engagement

While out-of-pocket expenses comprise 30% of payment, most healthcare providers only collect about a third of that amount from patients, most of whom have insurance.

According to a recent PYMNTS survey, as U.S. healthcare spending rose 7.5% in 2023: 

• Eight out of 10 organizations say they’ve lost money due to outdated accounts receivable processes.
• Seventy percent of providers still use paper for patient financial communications.
• Just over half (53%) believe they’ve adequately automated their patient payment processes.

These factors contribute to an environment where healthcare providers lose more than $6.5 billion in out-of-pocket healthcare revenue, the PYMNTS survey indicates. 

Taking a Consumer-Centric Approach

Certainly, affordability remains a limitation for increasing healthcare revenue. About half of consumers say healthcare is difficult to afford, a Kaiser Family Foundation survey found, and one out of four say they or a family member have experienced challenges paying for care. About 25% also skipped needed care due to concerns around cost. 

That’s why it’s important to ease the patient payment processes where it matters most to help consumers navigate costs of care in ways that make them feel more in control of the experience.

Designing a more consumer-friendly healthcare payment model should entail a closer look at these areas.

Put automation into play where it makes the most sense. Successful providers know: the patient financial experience cannot be one-dimensional—not if organizations hope to engage consumers across generations. Moreover, recent data shows that automation technologies and generative AI could cut the amount of time healthcare revenue staff spend on mundane tasks by half. This would give team members more time to focus on their patients instead of billing and payments. It’s one reason why four out of 10 healthcare leaders are exploring health tech solutions to strengthen core operations, including automation for revenue cycle.

Payment is a natural starting point for smart automation in revenue cycle. From text-based notifications that inform consumers of their amount due to digital explanation of benefits communications, automated patient finance tools put the right information in consumers’ hands faster. They also reflect a move toward mobile-friendly electronic billing and payment that consumers have grown used to in retail and now expect in healthcare. In our experience, small, under-resourced organizations, like independent physician practices, collect less than 20% of what they are owed when they don’t incorporate a tech-enabled approach to patient financial communications and payment.

Another area where we’re seeing automation put into play: AI-powered call centers. Today, 62% of call centers across industries are outsourced, according to Forrester research. Forrester predicts that gen AI will displace 100,000 frontline call center representatives from these outsourced companies. For in-house teams that make the move toward automation, this offers an opportunity for healthcare providers to shift call center employee to more value-added activities, like assisting patients in navigating the complexities of care.

Integrate EOBs with digital payment. As more consumers engage in digital mechanisms for patient financial communications and payment, health systems and physician practices can provide greater transparency into how much patients owe—and how this amount was determined—by integrating explanation of benefits (EOB) statements with text-to-pay models. For instance, when patients click on a secure text to view their bill and make a payment, they will also find the option to view their EOB. Some consumers may choose to do so before making a payment to ensure that insurance has paid its portion and verify the amount they have been asked to pay out of pocket. This not only supports faster payment, but also helps build trust with consumers.

Understand the consumer behaviors that influence payment. Take a look at the patient’s payment history. Which patients are most likely to pay their bills electronically—and which ones are least likely to pay at all? Digital is a no-brainer for patients who are already digitally engaged, but it’s also merely an added expense for patients who aren’t likely to settle their out-of-pocket expenses no matter how they are contacted. Make sure your model for patient financial communications incorporates a data-driven model for execution.

By building a multi-dimensional, patient-centric payment strategy that assesses preferences, efficiency and likelihood of payment, healthcare leaders can more effectively engagement consumers in their financial responsibility for care while reducing the costs of financial communications, processing and engagement.